PBGC Takes on Pension Plan of NJ Uniform Manufacturer

October 5, 2007 (PLANSPONSOR.com) - The Pension Benefit Guaranty Corporation (PBGC) will take over the pension plan of a New Jersey service sector uniform manufacturer, after the company failed to pay more than $1.3 million in pension funding obligations.

According to a press release, the retirement plan includes 650 workers and retirees and is about 60% funded, with $11.8 million in assets to cover $19.8 million in liabilities. The agency expects to be responsible for the entire $7.9 million shortfall.

The private sector pension insurer determined that Best Manufacturing Inc., located in Jersey City, could not meet its benefits payments when they were due and that the company would be abandoning the plan after its bankruptcy proceedings.

Best Manufacturing filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court in Newark, New Jersey in August 2006. 

In February, the court approved the sale of substantially all of the company’s assets for about $35 million to Dan River Inc; however that transaction did not include the pension plan.